Coinbase pockets USD5m for Bitcoin conversions

Online Bitcoin purchasing service Coinbase has raised USD5m in a Series A round led by Union Square Ventures. The San Francisco-based startup’s platform allows users to convert real money into Bitcoins, the virtual currency making waves online, and provides a digital wallet that users can store Bitcoins in and use to make online purchases.

Accepted by some 300 merchants, including Reddit.com and OKCupid.com, Coinbase claims to have attracted 116,000 users who have converted some USD15m into Bitcoins to-date, up from USD1m in January. A graduate of Y Combinator, Coinbase charges a 1% fee on all conversions and has raised a total of USD5.6m to date, which it says will be used to expand its team with engineers, designers and business support staff.